South Africa’s employment figures lowest in 9 years as unemployment rate falls to 23.3%

• Declined by 2.2m to 14.1m in Q2
• CPI rose 3.1% Y-o-Y in August 2020

Charles Abuede

South Africa’s employment figures fell by 2.2 million to 14.1 million in the second quarter hitting their lowest in almost a decade, even as the official rate of unemployment dropped, reaching the lowest level since the third quarter of 2011, data released by Pretoria-based Statistics South Africa show.

While the official unemployment figure fell to 23.3 per cent from 30.1 per cent in the three months through March, South Africa’s unemployment rate, which consists of people available for work but not seeking employment, rose to 42 per cent from 39.7 per cent during the second quarter. Though, the figure is estimated to rise in the third quarter as individuals, not seeking employment, begin job search and more businesses lay-off staff.

Confinements to control the spread of the COVID-19 pandemic put the economy into its longest economic downturn in 28 years, with GDP contracting more than anticipated in the second quarter. Most businesses were closed for 5 weeks from March 27 and some cut wages, others laid-off staff or shut down for all time due to the lockdown.

“The national lockdown was gradually eased from May 1. Notwithstanding, it hindered people from looking for work, so this significant decline in unemployment is inherent of the official definition of unemployment,” the statistics office said.

The number of persons who are formally jobless fell by 2.8 million to 4.3 million while the number of non-economically active individuals rose by 5.2 million to 20.6 million, as indicated by the report.

Meanwhile, South African inflation figure dawdled in August 2020 for the first time in three months despite the gradual easing of lockdowns in the country, as the consumer prices rose 3.1 per cent year-on-year in the month, compared with 3.2 per cent in the previous month, Statistics Office of South Africa revealed in a statement on its website. Prices rose 0.2 per cent in the month.

Similarly, core inflation, which excludes prices of food, non-alcoholic drinks, fuel and electricity, accelerated to 3.3 per cent during the month under review, hitting the highest level since March this year, which recorded 3.2 per cent.